Americas petrochemicals market outlook, w/c Jun 11
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http://china.chemnet.com
2018年06月13日 09:16:41 platts 【大 中 小】 |
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| Here's a quick look at the factors that could affect petrochemical markets in the Americas this week.
US OLEFINS
Ethylene market participants enter this week watching closely as to whether capacity will come back online after planned turnarounds, which limited trading activity last week as buyers held out for lower prices in anticipation of supply lengthening, sources said.
US spot prompt-month delivery closed Friday down 0.375 cent week on week and 0.25 cent day on day at 15-15.50 cents/lb FD USG. Spot pricing is expected to fall in the coming weeks as additional capacity comes back online, sources said.
One trader cited ExxonMobil's new 1.5 million mt/year cracker at Baytown, Texas, which is expected to come online by the end of June as a source of significant additional production volume.
In contract pricing, the market has yet to begin talking June contract pricing, however, a two-month settlement was reached late last week for April and May that dropped price levels to 39-month lows.
Propylene market participants, meanwhile, will look to feedstock costs and strong demand from downstream outlets to see if steep spot propylene prices will continue their climb.
Sustained supply tightness in the US acrylonitrile export market has been pushing ACN prices to five-year highs, prompting ACN producers to buy prompt propylene product, sources said.
US spot prompt polymer-grade propylene was assessed Friday at 61.25-61.75 cents/lb FD USG, up 0.5 cent week on week and unchanged from Thursday. In contract pricing, market participants expect June prices to increase by 2-5 cents/lb, with one downstream source expecting prices to climb more than 5 cents/lb.
US POLYMERS
US polyethylene market participants are awaiting preliminary domestic buying and inventory levels, which are likely to be released this week to better gauge pricing direction for June.
After marketwide decreases for linear low-density polyethylene buyers in May, and some one-off decreases for high density buyers, there is some belief that additional buyers could be in line for lower prices if further builds are seen. There is some belief the traditional summer slowdown could begin this month, however, other sources suggest buyers may feel the need to enter hurricane season with more inventory than last year.
Memories of Hurricane Harvey's aftermath are still relatively fresh in the market's mind. Exports, as a whole, have been stronger throughout the year, but that has not translated into additional supply for traders, who are also monitoring inventories for direction.
On the polypropylene side, market participants are closely monitoring upstream propylene spot prices, which have risen in June. Supply has remained limited, with a force majeure declaration by one major producer and stronger feedstock pricing contributing to the ongoing tightness.
There are expectations some imported resin could begin hitting the US market, possibly in late June or early July. PP exports remain virtually non-existent, sources say.
US AROMATICS
US spot toluene prices fell 15 cents last week, closing Friday at 285 cents/gal FOB USG amid anticipation of supply improvements in the coming weeks.
Extraction economics remained healthy, with the spread between prompt spot toluene and reformate at just under 28 cents.
The spread narrowed only slightly as declines in reformate offset lower toluene prices.
Toluene's blend value softened week on week, shedding near 4 cents to finish at just under 265 cents/gal FOB USG. The lower toluene price bodes well for dealkylation and disproportionation margins though these are expected to remain negative in the near term. Xylene prices also fell week on week, with spot mixed xylene prices falling 10 cents to 280 cents/gal FOB USG.
Sources said prices were under some pressure as octane availability had improved, but they noted that blend values and reformate would provide a price floor.
Sources said they expect paraxylene prices to remain soft in the near term as the market last week began to be talked again at a netback to Asia.
Also pressuring paraxylene price is limited demand from the purified terephthalic acid segment as BP was heard to have announced a 45% allocation on material from its worldscale PTA unit at Cooper River. In addition, BP was slated to restart PX production at Texas City last weekend, sources said, however confirmation is not yet available.
US PVC
Prices are expected to remain within a $830-$840/mt FAS Houston range this week, where producers settled June pricing, as the US market looks to Asia where producers are expected to announce July pricing soon.
Many Asian market participants expect July offers to be $20-$30/mt higher than in June, reflecting supply tightness in India due to plant shutdowns, but others expect a rollover or even a decrease compared with June as India's monsoon season approaches in July, which typically siphons off demand.
US producers remain bullish on PVC pricing, with expectations of a possible increase in US offers for July on the back of strong domestic demand, leaving little pressure to export.
Producers say domestic demand is high as the summer construction season ramps up, having been hindered by bad weather in the US Northeast and Midwest this spring. US ethylene dichloride prices were not expected to get a boost from a late May tender from Braskem for 13,000 dmt of US material for mid-July delivery because the deal apparently fell through, according to sources.
Olin is the only US EDC producer with notable export volume availability in June, and sources said Braskem did not accept its offer of $300/mt FOB USG.
LATIN POLYMERS
Importers in Brazil will again be paying close attention to ports and inland logistics following a 10-day independent truckers strike that concluded in late May, sources said.
The Brazilian PP and PE markets have been impacted by the action in the days since a resolution was reached, with restocking retail centers and fuel outlets a priority, making trucking options limited for those looking to move resins, sources said.
The effects were felt at the nation's ports, leading to some delays in moving cargoes inland, with such conditions expected to continue well into June at least, sources said.
Brazilian buyers will also be eyeing price increase announcements from local producer Braskem, which raised prices sharply in late May due to continued devaluations of the local currency, a company source said.
With the truck strike limiting trade, some buyers reported that Braskem was softening on those previously announced hikes, although a company source on Friday indicated it would still be pursued this month. Along South America's Pacific Coast, buyers will continue to monitor availability, based upon the theory that any limitations on Brazil's ability to receive cargoes could result in more shipments to markets such as Colombia, Peru and Chile, sources said.
In Colombia, PE importers and traders are monitoring the spread between low-density PE and linear-low-density PE, as the current gap of more than $100/mt could lead to the recent trend of rising LLDPE imports to continue, sources said.
Additionally, LDPE buyers are looking at domestic pricing in Bogota with an eye on the spread between imported LDPE and resins produced locally by Ecopetrol, sources said, adding that domestically produced resin was trending lower while import pricing has been relatively stable.
Additionally, Colombian HDPE market players will have an eye on this weekend's presidential elections and any potential policy changes that could impact the industry, with particular attention being paid to a 2017 law that requires large retailers to charge for non-reusable plastic bags, sources said.
LATIN AROMATICS
Much like their counterparts in the polymers industry, Latin American aromatics market players will be paying close attention to the lingering effects of the Brazilian trucker strike, with one source Friday saying a Brazilian benzene cargo had been unable to load for shipment to Argentina.
Additionally, players will be eyeing any further decreases in xylene pricing after aromatics pricing found traction on the back of strong energy prices, sources said. |
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